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Sen. Geist urges pass-through financing for Detroit‑Wayne County Port Authority
Summary
Sen. Geist and Mark Schrupp of the Detroit‑Wayne County Port Authority told the House Transportation Committee that Senate Bill 52 would let the authority use pass-through bond financing to lower costs for waterfront redevelopment and expand eligible projects—while, they said, keeping tax dollars and legal liability off taxpayers.
Sen. Geist asked the House Transportation and Infrastructure Committee to consider Senate Bill 52, a reintroduction of last term's legislation that would permit the Detroit‑Wayne County Port Authority to act as a conduit for pass-through bond financing that, supporters said, would not become a taxpayer liability.
The senator told the committee the measure would "empower the Detroit Wayne County Port Authority to accelerate economic development in and around the Detroit River," arguing that the port authority’s status as a public entity lets it offer financing terms developers cannot find in the private market.
Mark Schrupp, introduced as the executive director of the Detroit‑Wayne County Port Authority, told members the bill would allow the authority to finance projects it does not own and then pass lower-cost financing through to private developers. "They are not debts of the Port Authority at all, so we have no financial risk," Schrupp said, adding that the arrangement depends on the creditworthiness of the private borrower rather than on the port authority.
Schrupp described the change as an expansion of the port authority's toolbox. Under the current statute, he said, the authority generally must own the financed property; SB 52 would remove that ownership requirement and broaden eligible project types beyond strictly maritime infrastructure to include manufacturing and recreational facilities located near the waterfront. He cited potential projects such as shipbuilding suppliers, a propeller foundry, alternative-fuel facilities and waterfront hotels as examples of developments that could benefit.
Committee members pressed on risk and on where bond funds would originate. Representative Brock asked whether bonds would expose taxpayers; Schrupp replied that bonds would come from the private bond market and that if a borrower defaulted the bondholders would pursue the borrower's collateral, not the port authority's taxing base. Members also asked how the bill relates to other nearby projects, with witnesses saying the Gordie Howe International Bridge complements port-region development but is not legally tied to the proposed authority change.
Schrupp also described current port operations and finances, saying the authority carries no outstanding debt and receives operating support specified in statute—about 50% from the state and 25% each from the city and county—and that the authority is pursuing grants and private revenues to reduce dependence on appropriations.
No committee vote on SB 52 occurred during the hearing; the committee accepted testimony, read in supporting and neutral cards, and moved to the next agenda item.
